China: PetroChina Lobbys Authorities on Fuel Pricing

PetroChina Co., is lobbying the government to allow oil companies to earn “reasonable” margins after second-quarter profit missed estimates because of controls on fuel prices.

Photo(Jerome Favre): PetroChina Co. vice chairman and president Zhou Jiping

 The government’s pricing “mechanism should consider the sustainability of oil enterprises,” Zhou Jiping, president of the Beijing-based company, said at a media briefing in Hong Kong. “It should provide a reasonable profit margin.”

PetroChina has declined 8.1 percent in Hong Kong trading this year, compared with the 14 percent drop in the benchmark Hang Seng index. Net income in the first six months rose 1 percent to 66 billion yuan, missing analysts’ estimates. PetroChina’s refining business swung to a loss of 23.4 billion yuan from a profit of 3 billion yuan a year earlier, as the cost of processing crude into fuels climbed 3.1 percent to 138.75 yuan per ton.

PetrolWorld August 2011